University Of California's Latest Plan: Privatize Knowledge, Take Out Lots Of Patents -- Profit!

from the business-of-science dept

At the end of last year, we wrote about an extraordinary attempt by the University of California (UC) to resuscitate the infamous "Eolas" patents that were thrown out earlier by a jury in East Texas. Clearly, the University of California likes patents, and the way that they can be used to extract money from people with very little effort. In fact, it likes them so much it is trying to privatize research produced by taxpayer-funded laboratories so that even more patents can be taken out on the work, and even more money obtained through licensing them. The background to this new approach, implemented via a new entity provisionally entitled "Newco", is described in a fantastic feature by Darwin BondGraham that appears in East Bay Express:

The purpose of Newco is to completely revamp how scientific discoveries made in UC laboratories -- from new treatments for cancer to apps for smartphones -- come to be used by the public. Traditionally, UC campuses have used their own technology transfer offices to make these decisions. But under Newco, decisions about the fate of academic research will be taken away from university employees and faculty, and put in the hands of a powerful board of businesspeople who will be separate from the university. This nonprofit board will decide which UC inventions to patent and how to structure licensing deals with private industry. It also will have control over how to spend public funds on these activities.

Newco's proponents contend that the 501(c) 3 entity will bring much-needed private-sector experience to the task of commercializing university inventions. Ultimately, it will generate more patents, and thus bigger revenues for UC through licensing deals and equity stakes in startups, they claim. UC administrators also say they have established sufficient safeguards for Newco and that UCLA's chancellor and the regents will have oversight over the entity.

As that makes clear, at the heart of this approach is a belief that taking out more patents on publicly-funded research is a good thing. But as Techdirt reported five years ago, the legislation that started universities down this road, the Bayh-Dole Act of 1980, did not cause more research to be conducted in the academic world, contrary to what advocates of this law claimed would happen. Another article the same year noted that more patents actually led to much less collaboration, much greater secrecy and much higher costs to innovation.

The East Bay Express feature has a great comment from Gerald Barnett, who ran tech transfer operations at the University of Washington and at UC Santa Cruz, and therefore has some experience in this field. He explains why more patents are bad for the public that is paying for the research that generates them, and bad for the US economy:

"The problem is that you're taking out of circulation a vast amount of public domain knowledge and other stuff, and holding it hostage, making it less likely that any of these inventions will make money because you're focusing on exclusive licenses," he said.

What's better for the public and the broader economy, said Barnett, is a system in which most university inventions and knowledge quickly flows into the public domain, or is swiftly made available through non-commercial means. A relatively small number of university inventions that benefit from patent positions might be licensed out, Barnett said. But he's skeptical of the obsession with exclusive patent agreements with corporations.

The article goes on to explore the ways in which the worlds of UC academia and business are becoming deeply intertwined, and how this raises questions about potential conflicts of interest when decisions concerning the commercialization of discoveries are being made. It's an important piece that chronicles the University of California's shift away from the pursuit and sharing of knowledge for the benefit of all humanity, to the monopolization of ideas and maximization of profits for a few privileged investors.

Reader Comments

I think it would be ok. They just need to NOT take public money. Basically, they become a private school. I am sure the extra patent money will make up for the missing funding. And with the reduced enrollment, they can close many facilities that will save them.

Umm, NO

If a group is using public funds for their research, I see no reason that they should then be allowed to turn around and deny the very people paying for the research the benefits from it, and instead turn it into a source of personal profit.

At most I'd suggest a percentage system, where the percentage of public-private funding for research like this determines patent length. So use 90% public funds, 10% private, length is reduced to 10% of normal. 75% public funds, 25% private, patent length is 25% of normal, and so on.

The whole basis of academic research is the free flow of ideas, prior publication rules prevent this from happening. Net result fewer breakthroughs in science, and much incremental development to keep patent control of an area of research.
Any country that keeps patents in check, or throws them out, could become the technical and academic leaders of the world.

But under Newco, decisions about the fate of academic research will be taken away from university employees and faculty, and put in the hands of a powerful board of businesspeople who will be separate from the university. ... It also will have control over how to spend public funds on these activities.

...

Newco's proponents contend that the 501(c) 3 entity will bring much-needed private-sector experience to the task of commercializing university inventions.

So the taxpayers pay for the research, then they pay for the costs of privatizing the knowledge through the 501(c) 3, then they pay again to license the technology that they already paid for ... twice!

Third time's the charm!

The 501(c) 3 is the kicker for me, especially combining it with "a powerful board of businesspeople". That makes my head hurt just thinking about it. What's not to like for a greed-merchant?

So PATENTS are Mike's missing Step 2!

Yeah, I get this, minion and fanboys, but the 3-step similarity is too great to not remark upon given Techdirt's stand on patents, plus the opportunity to take another dig at "Step 2" -- last post dated May 25, ha!

Re: So PATENTS are Mike's missing Step 2!

...and why wouldn't they?

"It's an important piece that chronicles the University of California's shift away from the pursuit and sharing of knowledge for the benefit of all humanity, to the monopolization of ideas and maximization of profits for a few privileged investors."

They're just doing what is profitable, and patent trolls have proven for over 10 years now that their business model is profitable...and growing.

THEN spy get sued by nations lose patents and copyrights

HA
THIS SO WHY you dont put money into intellectual property as money and property
cause if you have a spying sack a shit govt and its spying on everyone and gets sued and loses and refuses to pay up....then you will get trade sanctions namely those very things you wish to try and patent...ok fine your own lil 300 million but if you cant make any money in a global market off your stuff then guess what

I PROFIT AND I LOVE THIS AND ENDORSE MROE US STUPIDITY...
go go go be all you cna be in the nsa army ....

Tie Government funding to mandatory public domain of results

It's simple, if taxpayer dollars funded the research, then all results, patents and copyrights are public domain from the get-go - no privatization allowed by any person, corporation or government entity period.

That's how it should be - now we just need an online petition to get it that way, with say 30 million signatures.

You are meant to think of a semi-retired CEO now working on projects to benefit the public.

The reality is that you get people with no particular expertise, but a skill for getting in the path of money and diverting some into their pocket. They'll always choose a quick one-time lump sum payment over a long term relationship.

Re: ...and why wouldn't they?

That isn't the point of the article. I even have a good analogy of what the article is saying for you. You help build a garden. You take part in the work every day, but at harvest time they sell you the produce instead of giving you your fair share.

"Public" is a mushy term here

In the time I worked as a UC researcher (admittedly, more than a decade ago and before the current round of funding crunches) - none of the research we were doing was funded by "public money". That's not to say nothing related to us was, but our pay, equipment, and materials all came out of private grants.

The buildings were built and maintained by a combination of public funds and private donations, professors had a portion of their salary paid by public money (and the rest paid by research grants, most of which were private), but the research materials, equipment, post-docs, etc were all funded privately, or at the very least weren't funded by the UC. One of our funding sources was the Dept. of Energy, which funds plenty of private research (another argument for another day).

I can't say I agree with the UC's patent policies (in fact I have plenty of problems with them), but in this particular instance, it's worth noting that it is not a majority of "public money" funding the research activities, which renders most of the argument here moot.